North Somerset Council is contemplating cuts to its council tax reduction scheme in an effort to save £500,000, a move that local officials warn could drive more residents into deeper poverty. The council is grappling with what it describes as “the most challenging financial situation in its history,” necessitating tough decisions on how to balance budgets while supporting vulnerable households.
Currently, about 11,250 households in North Somerset earn less than £1,400 a month, qualifying them for up to a 75% discount on their council tax bills under the reduction scheme. However, the council proposes reducing discounts by ten percentage points for 6,400 working-age low-income households—a group whose need for assistance is critical as council tax rates are based on property values rather than income.
Jenna Ho Marris, cabinet member for homes and health and a Green Party councillor, highlighted the ongoing challenges councils face due to inadequate government funding. “Since 2013, councils have been responsible for funding their own council tax reduction schemes without guaranteed funding from the government. Successive funding cuts have left councils with tough choices between slashing services or risking bankruptcy,” she said. Ho Marris voiced concerns that these cuts amid a cost-of-living crisis will deepen hardship for many residents.
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Bridget Petty, leader of the Green group on the council, emphasized the link between poverty and health outcomes. She cited mental health experts’ views on poverty as the top preventable cause of ill health and encouraged local people to voice their opinions through the council’s consultation, open until January 6.
If adopted, the proposed changes would reduce discounts for those with no monthly income from 75.5% to 65.5%, and for households earning between £1,000.01 and £1,400 monthly, discounts would drop dramatically from 18% to just 8%. This adjustment would reduce council spending on tax relief for working-age households from approximately £5.8 million to £5.3 million annually.
North Somerset Council faces a looming £10 million budget shortfall next year, exacerbated by an uncertain government fair funding review that may reduce financial support by £17 million over the coming years. Council leader Mike Bell acknowledged the necessity of making “really tough decisions” to find a fair balance between affordability and fairness for all residents relying on council services.
In response to the proposed cuts, the council plans to establish a discretionary hardship fund to aid households genuinely unable to pay their bills. However, applicants must provide proof of financial difficulties and evidence they have exhausted all other benefits and payment options.
This is not the first time reducing council tax discounts has been on the table. A similar £1.5 million saving proposal was scrapped last year after concerns it might contravene the Equalities Act due to disproportionately impacting vulnerable groups.
Facing potentially having to issue a section 114 notice—which signals a council’s inability to balance its budget—North Somerset is in talks with the government for exceptional financial support. Bell warned, “Such support comes with tough conditions and likely council tax increases for residents. It’s a consequence of government austerity policies, not a choice made lightly.”
Residents are urged to participate in the consultation by submitting their views before the deadline of 5pm on January 6, ensuring their voices are heard during these critical deliberations.